Correlation Between PMPG Polskie and Road Studio
Can any of the company-specific risk be diversified away by investing in both PMPG Polskie and Road Studio at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining PMPG Polskie and Road Studio into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between PMPG Polskie Media and Road Studio SA, you can compare the effects of market volatilities on PMPG Polskie and Road Studio and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in PMPG Polskie with a short position of Road Studio. Check out your portfolio center. Please also check ongoing floating volatility patterns of PMPG Polskie and Road Studio.
Diversification Opportunities for PMPG Polskie and Road Studio
0.86 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between PMPG and Road is 0.86. Overlapping area represents the amount of risk that can be diversified away by holding PMPG Polskie Media and Road Studio SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Road Studio SA and PMPG Polskie is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on PMPG Polskie Media are associated (or correlated) with Road Studio. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Road Studio SA has no effect on the direction of PMPG Polskie i.e., PMPG Polskie and Road Studio go up and down completely randomly.
Pair Corralation between PMPG Polskie and Road Studio
Assuming the 90 days trading horizon PMPG Polskie Media is expected to generate 0.97 times more return on investment than Road Studio. However, PMPG Polskie Media is 1.03 times less risky than Road Studio. It trades about -0.32 of its potential returns per unit of risk. Road Studio SA is currently generating about -0.32 per unit of risk. If you would invest 252.00 in PMPG Polskie Media on September 12, 2024 and sell it today you would lose (70.00) from holding PMPG Polskie Media or give up 27.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
PMPG Polskie Media vs. Road Studio SA
Performance |
| Timeline |
| PMPG Polskie Media |
| Road Studio SA |
PMPG Polskie and Road Studio Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with PMPG Polskie and Road Studio
The main advantage of trading using opposite PMPG Polskie and Road Studio positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if PMPG Polskie position performs unexpectedly, Road Studio can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Road Studio will offset losses from the drop in Road Studio's long position.| PMPG Polskie vs. PZ Cormay SA | PMPG Polskie vs. Echo Investment SA | PMPG Polskie vs. Quantum Software SA | PMPG Polskie vs. Gaming Factory SA |
| Road Studio vs. Movie Games SA | Road Studio vs. Gaming Factory SA | Road Studio vs. Logintrade SA | Road Studio vs. Monnari Trade SA |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the USA ETFs module to find actively traded Exchange Traded Funds (ETF) in USA.
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